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Tozzi v. Moffett

Supreme Court of Wyoming

December 3, 2018

JOHN R. TOZZI, Appellant (Plaintiff),
v.
J. DENNY MOFFETT and JEFF WILKINSON, Appellees (Defendants). JOHN R. TOZZI, Appellant (Plaintiff),
v.
RICHARD J. MULLIGAN, Appellee (Defendant).

          Appeal from the District Court of Teton County The Honorable Norman E. Young, Judge

          Representing Appellant: C.M. Aron, Aron & Hennig, LLP, Laramie, Wyoming.

          Representing Appellee J. Denny Moffett: Scott E. Ortiz and Scott P. Klosterman of Williams, Porter, Day & Neville, P.C., Casper, Wyoming. Argument by Mr. Klosterman.

          Representing Appellee Jeff Wilkinson: Kim D. Cannon, Davis & Cannon, LLP, Sheridan, Wyoming; Leah C. Schwartz, Davis & Cannon, LLP, Cheyenne, Wyoming. Argument by Mr. Cannon.

          Representing Appellee Richard J. Mulligan: John A. Sundahl and Patrick M. Brady of Sundahl, Powers, Kapp & Martin, LLC, Cheyenne, Wyoming. Argument by Mr. Sundahl.

          Before DAVIS, C.J., and BURKE [*] , FOX, KAUTZ, and BOOMGAARDEN, JJ.

          KAUTZ, JUSTICE.

         [¶1] This is a consolidated appeal involving professional malpractice, breach of fiduciary duty, and conversion claims arising out of conservatorship and divorce proceedings. In 2011, Georgene Tozzi filed for divorce from the appellant, John R. Tozzi. Concerned about Mr. Tozzi's mental state and potential waste of the marital estate, Mrs. Tozzi petitioned the district court for the appointment of a temporary conservator for Mr. Tozzi. The district court granted the petition and appointed Jeff Wilkinson as Mr. Tozzi's conservator and J. Denny Moffett as counsel for the conservator. Mr. Wilkinson and Mr. Moffett retained Richard J. Mulligan to represent Mr. Tozzi in the divorce. In October 2013, after the divorce concluded, the district court determined the conservatorship was no longer necessary and terminated it. In 2015, Mr. Tozzi filed a lawsuit against Mr. Wilkinson, Mr. Moffett and Mr. Mulligan (collectively referred to as "the Appellees") alleging conversion, professional malpractice, and breach of fiduciary duty. The district court granted summary judgment in favor of the Appellees, and Mr. Tozzi appeals those orders.

         ISSUES

         [¶2] Mr. Tozzi states the following claims in his appeal against Mr. Moffett and Mr. Wilkinson:

ISSUE 1: Did disputes of material fact preclude entry of summary judgment?
ISSUE 2: Was it error for the [d]istrict [c]ourt to strike the affidavit of [Mr. Tozzi's] expert for offering opinions based on hypothetical facts, and to grant summary judgment in reliance entirely on the non-factual affidavits of [the defendant's] experts?
ISSUE 3: Did the [d]istrict [c]ourt misapply the doctrines of res judicata and collateral estoppel to a legal malpractice claim alleging misconduct in obtaining the prior judgment?
ISSUE 4: Was it [e]rror for the [d]istrict [c]ourt to [d]isregard the [c]ommon [s]ense [e]xception in [a]pplying the [s]tandard [a]pplicable to [l]egal [m]alpractice?
ISSUE 5: In a [c]onservatorship, do Wyoming Statutes require submission of detailed billings to the [c]ourt for approval of attorneys' fees and [c]onservator fees?

         [¶3] Mr. Tozzi raises the following issues in his appeal against Mr. Mulligan:

ISSUE 1: Did disputes of material fact preclude entry of summary judgment?
ISSUE 2: Was it error for the [d]istrict [c]ourt to strike the affidavit of [Mr. Tozzi's] expert for offering opinions based on hypothetical facts, and to grant summary judgment in reliance entirely on the non-factual affidavits of [the defendants'] experts?
ISSUE 3: Is an attorney hired by a [c]onservator a third party claimant, such that his claim for attorneys' [fees] must be submitted in accordance with statute?

         FACTS

         [¶4] In 2011, Mrs. Tozzi filed for divorce. Mr. Tozzi did not respond to the divorce complaint and the clerk of court entered a default against him. Mrs. Tozzi then requested the district court appoint a temporary conservator for Mr. Tozzi to prevent waste of the marital property due to Mr. Tozzi's mental state. Mr. Tozzi struggled with depression throughout his life, and his condition worsened after Mrs. Tozzi filed for divorce. She was concerned with his inability to receive and evaluate information, make or communicate decisions, or manage the property. In the days leading up to Mrs. Tozzi's request for the conservator, Mr. Tozzi's daughter visited her father and found him living in filth and squalor and not taking care of himself. The daughter tried to convince Mr. Tozzi to seek medical treatment, and after he refused, she called for emergency assistance and he was taken to the hospital via ambulance. The district court appointed Mr. Tozzi's longtime accountant, Jeff Wilkinson, as temporary conservator, and J. Denny Moffett as legal counsel for Mr. Wilkinson as conservator. Mr. Wilkinson and Mr. Moffett retained Richard J. Mulligan to serve as Mr. Tozzi's counsel in the divorce proceedings.

         [¶5] The district court converted the temporary conservatorship to a permanent conservatorship, and the divorce proceedings continued to trial after Mr. Mulligan convinced the court to set aside the default judgment entered against Mr. Tozzi. After a trial, the district court entered a divorce decree dividing the marital property. Mr. Tozzi received approximately $75, 000, 000 in assets and Mrs. Tozzi received approximately $74, 500, 000 in assets.

         [¶6] On May 20, 2013, seven months after the divorce decree was entered, Mr. Wilkinson and Mr. Moffett filed a petition requesting that the district court terminate the conservatorship. The district court heard the petition in July 2013, determined Mr. Tozzi was no longer in need of a conservator, and ordered that Mr. Wilkinson transfer the assets in the conservatorship to Mr. Tozzi and prepare the final report and accounting of the conservatorship. He did so, and on October 3, 2013, the district court entered an order approving the final report and accounting and terminated the conservatorship.

         [¶7] Nearly a year later, Mr. Tozzi submitted a motion under Wyoming Rule of Civil Procedure 60(b), requesting the district court vacate its final order in the conservatorship except for the actual termination of the conservatorship. Mr. Tozzi argued the Appellees engaged in continued misconduct during the entirety of the conservatorship and alleged they made various misrepresentations to the court. Mr. Tozzi also claimed the Appellees took excessive fees from the conservatorship, failed to follow statutory procedures for submitting attorney's fees claims, and the final report and accounting did not comply with the law. He explained he did not bring the motion sooner because he could not retain counsel until August 2014 and did not have access to Mr. Wilkinson's conservator records until September 2014. The district court denied the motion, finding that Mr. Tozzi had not filed his motion in a reasonable amount of time after entry of the order and he failed to provide newly discovered evidence that would justify setting aside the order in the conservatorship proceeding.

         [¶8] Mr. Tozzi did not appeal the district court's order denying the Rule 60(b) motion. Instead, he filed a complaint against Mr. Wilkinson and Mr. Moffett alleging conversion of funds, professional malpractice, and breach of fiduciary duty. He filed a separate complaint against Mr. Mulligan, also alleging conversion of funds and professional malpractice. The two cases were consolidated for discovery and trial. The district court issued a scheduling order, which included the requirements and deadlines for expert witness designations. The parties filed their expert witness designations on the date designated in the scheduling order.

         [¶9] Each of the Appellees filed a motion for summary judgment. While each motion varied, all three were based on these premises: 1) there were no genuine issues of material fact in dispute and the Appellee was entitled to judgment as a matter of law; and 2) the doctrines of res judicata and collateral estoppel precluded Mr. Tozzi from relitigating these claims. Mr. Tozzi responded to each motion, and also filed an affidavit from one of his expert witnesses, Henry Bailey, an attorney who has practiced law in Wyoming for almost forty years. Mr. Moffett and Mr. Mulligan moved to strike Mr. Bailey's affidavit under Wyoming Rule of Civil Procedure 37(c) on the ground that the affidavit contained opinions about causation that were not disclosed in Mr. Bailey's expert witness designation. They also pointed out that in his deposition, Mr. Bailey testified he had no opinions regarding causation and damages; therefore his affidavit opinions were directly contrary to his previous testimony. The district court determined that, because Mr. Bailey's causation opinions were not disclosed in his expert witness designation, they were untimely, and granted the motion to strike Mr. Bailey's affidavit.

         [¶10] The district court granted summary judgment in favor of the Appellees. The court agreed that the doctrines of res judicata and collateral estoppel prevented Mr. Tozzi from relitigating the reasonableness and lawfulness of the fees that were approved by the court in the conservatorship proceedings. The court also concluded that each of the Appellees had demonstrated a prima facie case for summary judgment and Mr. Tozzi had failed to come forward with evidence demonstrating a genuine issue of material fact. Mr. Tozzi timely appealed each of those orders.

         STANDARD OF REVIEW

         [¶11] When reviewing a district court's order granting summary judgment, we review the decision de novo.

[W]e review a summary judgment in the same light as the district court, using the same materials and following the same standards. Snyder v. Lovercheck, 992 P.2d 1079, 1083 (Wyo. 1999); 40 North Corp. v. Morrell, 964 P.2d 423, 426 (Wyo. 1998). We examine the record from the vantage point most favorable to the party opposing the motion, and we give that party the benefit of all favorable inferences that may fairly be drawn from the record. Id. A material fact is one which, if proved, would have the effect of establishing or refuting an essential element of the cause of action or defense asserted by the parties. Id. If the moving party presents supporting summary judgment materials demonstrating no genuine issue of material fact exists, the burden is shifted to the non-moving party to present appropriate supporting materials posing a genuine issue of material fact for trial. Roberts v. Klinkosh, 986 P.2d 153, 155 (Wyo. 1999); Downen v. Sinclair Oil Corp., 887 P.2d 515, 519 (Wyo. 1994).

Bear Peak Res., LLC v. Peak Powder River Res., LLC, 2017 WY 124, ¶ 10, 403 P.3d 1033, 1040 (Wyo. 2017) (quoting Rogers v. Wright, 2016 WY 10, ΒΆ 7, 366 ...


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